We Think Mind Gym (LON:MIND) Has A Fair Chunk Of Debt

Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously said that 'Volatility is far from synonymous with risk.' So it seems the smart money knows that debt - which is usually involved in bankruptcies - is a very important factor, when you assess how risky a company is. We can see that Mind Gym plc (LON:MIND) does use debt in its business. But the more important question is: how much risk is that debt creating?AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. When Is Debt A Problem? Debt assists a business until the business has trouble paying it off, either with new capital or with free cash flow. In the worst case scenario, a company can go bankrupt if it cannot pay its creditors. However, a more common (but still painful) scenario is that it has to raise new equity capital at a low price, thus permanently diluting shareholders. Of course, debt can be an important tool in businesses, particularly capital heavy businesses. When we examine debt levels, we first consider both cash and debt levels, together. What Is Mind Gym's Debt? You can click the graphic below for the historical numbers, but it shows that as of September 2025 Mind Gym had UK£1.40m of debt, an increase on none, over one year. However, because it has a cash reserve of UK£355.0k, its net debt is less, at about UK£1.05m. AIM:MIND Debt to Equity History January 30th 2026 How Healthy Is Mind Gym's Balance Sheet? According to the last reported balance sheet, Mind Gym had liabilities of UK£9.74m due within 12 months, and liabilities of UK£425.0k due beyond 12 months. On the other hand, it had cash of UK£355.0k and UK£5.38m worth of receivables due within a year. So its liabilities total UK£4.43m more than the combination of its cash and short-term receivables. Mind Gym has a market capitalization of UK£13.5m, so it could very likely raise cash to ameliorate its balance sheet, if the need arose. But we definitely want to keep our eyes open to indications that its debt is bringing too much risk. When analysing debt levels, the balance sheet is the obvious place to start. But you can't view debt in total isolation; since Mind Gym will need earnings to service that debt. So if you're keen to discover more about its earnings, it might be worth checking out this graph of its long term earnings trend. See our latest analysis for Mind Gym In the last year Mind Gym had a loss before interest and tax, and actually shrunk its revenue by 28%, to UK£32m. To be frank that doesn't bode well. Caveat Emptor Not only did Mind Gym's revenue slip over the last twelve months, but it also produced negative earnings before interest and tax (EBIT). Its EBIT loss was a whopping UK£7.0m. Considering that alongside the liabilities mentioned above does not give us much confidence that company should be using so much debt. So we think its balance sheet is a little strained, though not beyond repair. Another cause for caution is that is bled UK£971k in negative free cash flow over the last twelve months. So in short it's a really risky stock. There's no doubt that we learn most about debt from the balance sheet. But ultimately, every company can contain risks that exist outside of the balance sheet. These risks can be hard to spot. Every company has them, and we've spotted 3 warning signs for Mind Gym (of which 2 are potentially serious!) you should know about. If, after all that, you're more interested in a fast growing company with a rock-solid balance sheet, then check out our list of net cash growth stocks without delay.